Lego builds on strong growth despite higher costs

Denmark’s Lego Group said it had seen a strong start to the year on Wednesday, despite surging input inflation holding back profits.

The privately-owned group, the largest toymaker in the world, said revenues in the six months to 30 June had risen 17% year on year, to 27bn Danish krone (£3.3bn).

Consumer sales rose 13%, with particularly strong performances in the Americas, western Europe and Asia Pacific. The brand opened 66 new stores in the first half, 46 of which were in China, taking the total number of stores to 833.

Operating profits were flat, however, at DKK 7.9bn, constrained by the rising cost of raw materials, energy and freight. Net profit fell 2% to DKK 6.2bn.

Niels Christiansen, chief executive, said: "We got off to a strong start in 2022 and are very satisfied with our performance, which landed above expectations after an exceptional 2021.

"Despite global uncertainties, we continue to deliver higher consumers and double digit top line growth driven by demand for our strong portfolio."

Looking to the rest of the year, he added: "We continue to see strong demand for our products. Longer-term, we expect top line growth to normalise to more sustainable levels."